UnitedHealth Group, Minnesota Equity Fund To Provide $9.8 Million In Equity To Build Affordable-Housing Community In Duluth
- Duluth Hillside Apartments will bring 44 new supportive housing and services to families with children who are at-risk of becoming or have been homeless
- Groundbreaking celebration announces community to be renamed the Steve O'Neil Apartments
- Minnesota Equity Fund established by Greater Minnesota Housing Fund (GMHF), with initial capitalization of $50 million provided through UnitedHealth Group
The Minnesota Equity Fund (MEF) and UnitedHealth Group are investing $9.8 million in equity to help develop and construct the Duluth Hillside Apartments, a new 44-unit affordable-housing community in the heart of downtown.
Duluth Hillside Apartments is a major redevelopment project, replacing one square block of vacant and blighted commercial and residential buildings. The new community will provide homeless families and their children the opportunity to live healthier lives and break cycles of generational poverty. In addition to the 44 units of housing, six units of emergency family shelter housing will be operated on site.
The $9.8 million investment by UnitedHealth Group and MEF clears the way for construction to begin on the new development with an official groundbreaking celebration today. During the event, the future housing community was renamed as the Steve O'Neil Apartments, in honor of the former St. Louis County Commissioner, who passed away in July.
MEF was established by Greater Minnesota Housing Fund (GMHF), based in St. Paul, with initial capitalization of $50 million provided through UnitedHealth Group. MEF's mission is to enable socially motivated corporations and financial institutions to make sound economic investments in high-quality affordable-housing developments that qualify for federal housing tax credits.
"We are grateful to UnitedHealth Group and MEF for providing the critical equity needed to get construction underway for the Hillside Apartments, which is an important part of Duluth's revitalization and redevelopment," said Duluth Mayor Don Ness. "The results from all the work of the many community partners will be safe, quality affordable housing and services to families who are in greatest need of support. It's fitting this project will be named after Steve O'Neil – I can't imagine anyone being more deserving of such an honor."
The announcement to invest in Hillside Apartments is part of a joint partnership between UnitedHealth Group, based in Minnetonka, Minn., and MEF to provide a total of $50 million in equity to finance the construction of new affordable-housing communities throughout Minnesota and the Great Lakes region. To date, five projects are under construction or recently completed, creating 162 new affordable homes for individuals and families. MEF and UnitedHealth Group will announce additional developments in the coming months.
"UnitedHealth Group is working with MEF to provide the critical funding for Hillside Apartments that will bring new affordable-housing opportunities to Duluth," said John Miklausich, site director for UnitedHealthcare's offices in Duluth, where the company employs more than 1,400 people. "This development project is an example of many partners coming together to help enhance our city and provide greater access to affordable housing."
"Hillside Apartments will serve a vital need in Duluth because it will provide affordable housing for people with some of the greatest needs in this community," said Warren Hanson, president and CEO of GMHF. "We are so grateful for the support from UnitedHealth Group and all our partners for helping make today's announcement possible."
Duluth Hillside Apartments is being developed by Center City Housing Corporation (CCHC) and One Roof Community Housing, two Duluth nonprofit housing development organizations. In addition to UnitedHealth Group and MEF, other major partners include the City of Duluth, the Duluth Housing Redevelopment Authority, Local Initiatives Support Corporation (LISC) and Minnesota Housing, which secured the financing from UnitedHealth Group and MEF through the award of Low Income Housing Tax Credits (LIHTC).
"Today's announcement by UnitedHealth Group and MEF to invest in Hillside Apartments is wonderful news, and we are grateful for their support," said Rick Klun, executive director of Center City Housing Corporation. "With the investment and financing complete, we are eager to begin construction on this new community that will be a model for supportive family housing."
When completed in the winter of 2014, Hillside Apartments will provide one-, two- and three-bedroom affordable apartments to households that qualify for section 8 rental assistance, which will enable all residents to pay no more than 30 percent of their income for rent. An emergency family shelter with six housing units will also be operated on site by CHUM, a local nonprofit human services agency sponsored and governed by Duluth-area faith-based congregations.
The new apartment community will be close to jobs and public transportation and include features such as open floor plans, energy-efficient appliances, parking, a community room and children's playground. There will be 24-hour onsite management, and social services and caseworkers to provide job training, counseling and coordination with health care providers.
UnitedHealth Group, through its Affordable Housing Investment Program, has provided more than $150 million in financing for community developments similar to Hillside Apartments throughout the United States. As part of that program, the company also provided $7.1 million to build The Firehouse and Firehouse Flats in Duluth, which opened in February, transforming two historic buildings into a 40-unit apartment community.
About The Minnesota Equity Fund
MEF is a subsidiary of the Greater Minnesota Housing Fund (GMHF), a non-profit Community Development Financial Institution, established by The McKnight Foundation and Blandin Foundation. GMHF provides loans, equity investments, grants and technical assistance to create affordable housing in Minn. In its 16-year history, it has raised over $150 million and financed over 11,000 affordable homes. MEF's initial fund is a strategic partnership between GMHF and Great Lakes Capital Fund (GLCF), a nationally recognized syndicator of low-income housing tax credits (LIHTC) with $2.5 billion under management and 20 years of experience and expertise in affordable housing.
About UnitedHealth Group
UnitedHealth Group (NYSE: UNH) is a diversified health and well-being company dedicated to helping people live healthier lives and making health care work better. With headquarters in Minnetonka, Minn., UnitedHealth Group offers a broad spectrum of products and services through two distinct platforms: UnitedHealthcare, which provides health care coverage and benefits services; and Optum, which provides information and technology-enabled health services. Through its businesses, UnitedHealth Group serves more than 80 million people worldwide. For more information, visit UnitedHealth Group at www.unitedhealthgroup.com.